Articles

SIDREC to Capital Market Investors: We’ve Got Your Back! (Part 2)

In our previous article SIDREC to Capital Market Investors: We’ve Got Your Back! (Part 1), Sujatha Sekhar Naik, CEO of SIDREC talked about the scope of services that SIDREC provides, and the types of cases and monetary claims and limitations when coming to SIDREC for dispute resolution. In this article as featured in the September 2017 issue of Smart Investor, we find out more on what mediation is, other aspects if SIDREC’s dispute resolution process and its successes in resolving cases.

We reproduce Part 2 of the article as featured in Smart Investor.

What is mediation?

Mediation is an effective way of resolving disputes without the need to go to court. It involves a mediator who is an independent third party.

The mediator’s role is to help the parties communicate and reach an agreement and outcome that is acceptable to both parties.

Mediation meetings are very practical and common sense in approach. The mediation process is confidential and the discussions will not be disclosed to any party outside of SIDREC’s dispute resolution process.

Why resolve claims at mediation stage?

Members and claimants retain control and decide the outcome.

Disputes are resolved, goodwill and business relationship maintained.

Time and cost efficient.

Affordable independent and impartial expert help in resolving disputes.

Smart Investor (SI): It is mentioned that SIDREC’s dispute resolution process is an informal one. What happens from the time an investor lodges a complaint until the issue is solved?

Sujatha Sekhar Naik (SN): The process begins once a claim form comes to us in the form of a letter, phone call, online enquiry, or walk in. We will then start engaging the parties with the view to resolve.

Claimants should come to us with the relevant information and complete a claim form. However, for those who have a handicap or other challenges, we will help where we can.

Some claimants come to us not knowing anything; all they know is they have a problem that made them lose money and it’s not their fault. So, we assist them in structuring their thoughts and bringing the information together.

A case manager is assigned to undertake the initial assessment and to investigate the claim. He will engage with the member and claimant during the case management stage.

The case manager stays with the case through the process, and will be the point of communication and support for the parties. We will assess the eligibility and merit of the claim and verify the information provided. Once the assessment is done, a date is set for mediation.

Confidentiality is crucial. Both claimant and member will speak freely only if they are confident it is safe to do so, and both genuinely want to resolve the matter. This is more so during mediation.

The mediator will facilitate a constructive conversation and ensure a fair process.

At mediation, both parties have control over the outcome, the member, as to what they wish to offer, and the claimant and what he is willing to accept. This is a perfect opportunity for parties, with the help of an independent expert, to conclude the matter on terms that are mutually acceptable and in some cases, still maintain a relationship with the other party.

If both parties agree to a settlement, it will be a full and final settlement of the claim. Otherwise, they go to the next step which is adjudication.

During adjudication, SIDREC’s adjudicator will conduct a hearing of the matter. Both parties will be able to submit their case and provide extra information, including bringing in witnesses. They may ask questions and seek clarification from the other party. The adjudicator too may put questions to both parties.

At the end of the hearing, the adjudicator will consider the matter and issue a decision. Parties will be informed, and if the claimant accepts the decision, the member must comply to the terms of the award that are granted by the adjudicator. This would be a full and final settlement of the claim.

SI: How receptive is the public at large to SIDREC since its establishment in 2011?

The number of claims and enquiries increased by 51.3% from 2015 to 2016, with eligible claims increasing by 73%, and enquiries by about 28%.

What’s gratifying is as of July 2017, we have already received 404 claims and enquiries, which while still not a large number, exceeds last year’s total. This shows more people are reaching out to SIDREC.

There is growing recognition that we are independent, and have the capital market expertise and knowledge, both from the regulatory side, and the practical aspects of the market.

SI: Moving forward, what does the future look like for SIDREC in the eyes of its CEO?

SN: It’s a multi-layered objective. Ultimately, it’s to have built a sustainable quality service that’s nimble and relevant to a developing market, accessible to all investor segments, and regarded as providing effective help to both the investing public and the market.

I hope in doing this, we will also contribute to building better investing habits, and ethical and professional conduct on the part of the market intermediaries.

I would like everyone who invests or is thinking of investing to know about SIDREC’s service, so that if they ever hit a roadblock, they think of us. It’s not so much about increasing the number of claims. That’s not my target. It’s to ensure the public know we are here. Just that knowledge, I feel, contributes to investor confidence.

With digitisation, increased mobility, and growing number of cross border transactions, it’s also important to know that SIDREC is nationality neutral. Our services are open to all investors, as long as it relates to a transaction with our member.

We will continue to work with our peers and other stakeholders for a healthy capital market, supporting the regulators in facilitating an empowered and con dent investing public.